Chronicle of a grab foretold

The details may be dizzying but the outline is simple. It’s the silhouette of a democracy being transformed into a private fiefdom. To take in the scale of everything that has happened concerning Vitals Global Healthcare – revelations at every stage and yet the deal continued to roll on – you need to go back four years.

Three of Malta’s hospitals have been effectively privatised for over a generation (30 years, with the potential of being extended to 99 years). The concession was first given to people, hidden behind VGH, whose identity, sharp practices and failures we only discovered thanks to investigative journalists.

At every turn, requests for information about VGH were turned down – resisted by the government or its proxies.

And, with each shocking revelation the government showed no shock.

Not only. It didn’t even try to dispel the natural suspicions that arose. On the contrary, it fanned the suspicions by resisting the publication of the necessary documents. Even now, the contract signed was made public with about 20% blacked out.

The successive revelations have been numerous. One set has to do with when the agreement with VGH was really reached.

In October 2014, the government signed a secret memorandum of understanding with the businessmen behind VGH – a full five months before Projects Malta published a request for proposals from anyone interested in running the three hospitals.

In March 2015, Daphne Caruana Galizia revealed that the government had already reached this agreement. No shock, no cabinet resignations. The very existence of this memorandum was never acknowledged.

Once its existence was confirmed, the government did everything to prevent us from seeing it. Malta Enterprise rejected the request by The Times of Malta under the Freedom of Information Act. Malta Enterprise would not even let the Data Commissioner see the MOU in order to adjudicate the matter.

The Data Protection Appeals Tribunal upheld the government’s position, stating that the document was covered by ‘confidentiality’ and that, in any case, it was not necessary to see it since, by then, the contract had been published.

But what can the contract say about whether the public call for proposals was a sham? Since when has the public interest in knowing if there’s been a cover-up become, officially, defined as being too nosey about private information?

The next set of revelations is about the people involved. Caruana Galizia revealed the dodgy business past of VGH’s initial frontman, Ram Tumuluri, as well as the fact that VGH was a start-up, with no experience of the health sector. The Shift has identified others behind VGH.

The group later bowed out of the concession, apparently unable to raise the necessary financing. The Sunday Times revealed that VGH had missed every investment milestone to which it had committed. There is a mystery about what it did with the €50 million it received from the taxpayer.

You would think that the government would be keen to show that this failure was an unpleasant surprise to it as well. But it refuses to publish the due diligence report that gave VGH a clean bill of health. Or to explain what VGH actually did with our money. Surely it knows. Surely it asked.

Now, thanks to The Shift, we have a better idea: our money was used as someone else’s piggy bank. The former, once-secret owners of VGH used the Malta concession and our millions to promote itself in other countries, to buy companies and to award its owners contracts that will provide a high income over and above what the government has already committed to paying for the running of its hospitals.

This brief chronicle leads to three observations. The first is about the pattern that’s revealed. The similarity to the Electrogas deal – the backroom deals, the secrecy, the mendacity, the initial insolvent participant who withdraws, the lack of financial logic for the public purse, the obvious profits for shadowy participants – has already been pointed out.

But perhaps it’s also useful to point out that the kind of regime that permits private businessmen to dig into national coffers includes Ben Ali’s Tunisia. That regime was being hailed as a ‘Mediterranean Tiger’ in its last period, given its strong economic growth rate. But its foundations were still rotten at the core.

We are not near there yet. But let us have no illusions. For the second observation is that this case cannot simply be dismissed as a case of someone stealing from the till. All this happened partly because the public’s right to scrutiny was officially denied several times in the name of the privacy of businessmen paid out of our own pockets.

If the public has no right to information about public assets, then those assets are effectively already being treated as private by the authorities who should be protecting the public interest.

The third observation is that here is a case where journalism did its work at every stage. Yet the government ploughed on. It continues to do so with barely a faltering step. It does not apologise, it does not explain.

Find out what the investigation revealed in ‘The Big Sell Out’ series.